17 December 2019
Coal lending was on the agenda two weeks before ANZ’s annual shareholder meeting in Brisbane today, as revelations hit the news that ANZ had a secret plan to slash its thermal coal mining loans by 75% (representing more than $700 million) by 2024.
The secrecy of the plan, and the fact that CEO Shayne Elliott was publicly contradicting it at the same time, meant shareholders arrived with a plethora of questions about the bank’s real intentions over climate change action.
Thanks to a resolution lodged by shareholders in October calling on ANZ to reduce its exposure to coal, oil and gas in line with the climate goals of the Paris Agreement, climate action was already on the formal agenda of the AGM.
The resolution achieved a 14.89% vote in favour, representing $10.47 billion dollars worth of support from investors.
David Gonski opened the meeting expressing concern about the bushfires that have ravaged many parts of Australia and said the bank would offer financial assistance to those hit by bushfires and drought.
But it soon became clear that ANZ was just as interested in providing financial assistance to the causes of greenhouse gas emissions that are making extreme weather and climate conditions worse.
Shareholders were clearly concerned about ANZ’s willingness (or lack thereof) to deliver on its internal target to reduce thermal coal mining exposure. They made clear their expectations that the board commit to, publicly and in writing, disclosing the target and the appropriate accountability mechanisms to achieve it.
Shareholders were also confused and dissatisfied that ANZ’s secret coal target only runs until 2024, while major investors and the scientific community are calling for a complete exit from thermal coal in OECD countries by 2030. ANZ’s major competitor Commonwealth Bank has already committed to exit thermal coal by 2030.
But in response to questions about ANZ reducing OECD thermal coal exposure to zero by 2030, Gonski stated “we don’t believe in having dates”. He referred to the fact that they have cut their exposure to coal by 50%, but provided no further targets for reducing exposure.
Shareholders also noted that, unlike its major competitor CommBank, ANZ’s coal target only addresses thermal coal mining but not coal-fired power generation. Asked when ANZ will commit to exit coal-fired power generation in line with the Paris Agreement, the board told shareholders that it didn’t think it was helpful to disclose this to customers:
It seems the bank expects shareholders to simply assume it has done its risk assessment adequately.
Given that ANZ’s secret plan only addresses thermal coal mining, shareholders were also concerned about the bank’s planned exposure to metallurgical coal (used to make steel) and overall (thermal and metallurgical) coal.
Asked what these plans were and whether they will be consistent with the climate goals of the Paris Agreement, ANZ told shareholders that they want a “orderly and just transition”. However, CEO Elliott went on to say very clearly that “we are not putting out dates nor policies until they are well thought through”.
Which begs the question, if a just and orderly transition is needed, then surely a clear transition plan must be disclosed to the public – something they seem to be unwilling to provide.
Do you bank with or own shares in ANZ? See how much they’ve lent to fossil fuels and compare with other banks.